The European Union agreed on Monday to ban the majority of Russian oil imports as part of a new sanctions package against Moscow, according to the European Council chief.

Leaders of the European Union have agreed to ban more than two-thirds of Russian oil imports.

Further sanctions

The late-night agreement intended to cut "a huge source of financing for its war machine," European Council chief Charles Michel tweeted.

"Maximum pressure on Russia to end the war," he said. 

Leaders of the 27-nation bloc met earlier Monday in Brussels to negotiate the long-awaited agreement, which also includes plans for the EU to send $9.7 billion in "immediate liquidity" to Kiev, according to Michel.

Ukrainian President Volodymyr Zelensky had earlier called an oil embargo the "key point" of any sanctions package.

"I believe that Europe will have to give up Russian oil and oil products in any case because this is about the independence of Europeans themselves from (weaponised) Russian energy," he said in his daily address to the nation.

On Tuesday, the Netherlands and Denmark were expected to join the growing list of European countries whose gas shipments were halted after refusing to pay Russian giant Gazprom in rubles, a demand intended to avoid Western sanctions.

The division of Europe

Following Hungarian President Victor Orban's warning that halting supplies would wreck his country's economy, participants in Monday's EU summit hammered out a compromise deal that exempts pipeline deliveries from the oil import ban.

On her account, EU chief Ursula von der Leyen said the ban "will effectively cut around 90 percent of oil imports from Russia to the EU by the end of the year".

The sanctions also included disconnecting Russia's largest bank, Sberbank, from the global SWIFT system, banning three state broadcasters, and blacklisting individuals according to Michel.

#Unity

Agreement to ban export of Russian oil to the EU.

This immediately covers more than 2/3 of oil imports from Russia, cutting a huge source of financing for its war machine.

Maximum pressure on Russia to end the war.

#EUCO

— Charles Michel (@eucopresident) May 30, 2022

Meanwhile, ahead of the summit, Hungarian Prime Minister Viktor Orban stated that no agreement on the oil embargo had been reached during preliminary talks between EU envoys. Orban accused the European Commission of being irresponsible and demanded that European countries ensure their energy security before imposing any sanctions.

Orban has previously stated on Monday that "there is no agreement at all."

"There is no compromise at this moment at all. There is no agreement at all," Orban declared.

The PM stated that if energy security solutions were discovered for his nation, he would agree to the sixth package of penalties.

Budapest has rejected a proposal to give it two years longer than the rest of the EU to wean itself off Russian oil as insufficient.

It seeks at least four years and $860 million in EU money to convert its refineries to process non-Russian petroleum and increase pipeline capacity to neighboring Croatia.

According to the German Economy Minister Robert Habeck on Sunday, the EU's unity after Russia's operation in Ukraine is beginning to "crumble".

Gazprom to cut supply

Meanwhile, Russia's Gazprom was set to cut off gas supplies to the Netherlands on Tuesday, with Denmark likely to follow suit.

As part of its efforts to curb Western financial sanctions, Moscow has demanded that clients from "unfriendly countries," including EU member states, pay for gas in rubles.

Orsted, a Danish energy company, also warned that its gas shipments could be cut off if a payment deadline of May 31 was missed.

Russia previously halted deliveries to Finland, Bulgaria, and Poland.

The EU has struggled to get an agreement on placing an oil embargo on Russia, with several member countries expressing fears that the measure would be disastrous for their economies. Hungary, which gets the majority of its oil from Russia, has been the most vocal opponent of the embargo, equating the potential consequences to "an atomic bomb." Other landlocked countries, including Czechia and Slovakia, have expressed similar concerns about the embargo.